Sunday, 16 November 2014

Indian Government Mulling Dropping 5/20 Rule for New Airlines to Fly International

The Government of India, which brought out a rule that every new domestic airline will not be allowed to fly international till the time it has got 5 years of operational experience and a fleet of 20 aircraft, is now considering removing this restrictive rule and letting the players go international. With airline profits bleeding for many years now and new players being reluctant to enter this industry, which many call as a death knell for airlines, this positive move would open the way for exploring more profitable routes and market driven expansion.

The move has been pushed by the new entrant Tatas into the aviation sector.With partnerships in full service carrier Air Vistara (in which Tatas hold a 51% stake and Singapore Airlines the rest of it) and budget airline AirAsia India, the rule has been much of an unwarranted restriction.
However, the current airlines that have been the victims of this ruling for all these years now, are opposing the move saying that the rule shall be applicable for new entrants as well.

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